Economics Quiz

What would happen to demand and supply of gas if the government lowered the price to $1?

• Demand would increase, and supply would decrease

• Demand would decrease, and supply would increase

• Both demand and supply would increase

• Both demand and supply would decrease

What would happen to demand and supply of corn if the government raised the price to $30?

• Demand would increase, and supply would decrease

• Demand would decrease, and supply would increase

• Both demand and supply would increase

• Both demand and supply would decrease

What does a price floor lead to?

• A surplus of the product

• A shortage of the product

• No effect on the market

• Decrease in product quality

What does a price ceiling lead to?

• Increased supply

• Decreased demand

• Shortages

• Price stability

Define the term "market equilibrium."

• The point where supply and demand curves intersect

• A situation where market supply exceeds demand

• A state where demand exceeds supply

• The process of determining the market price for a product

Define the term "equilibrium price."

• The price at which the quantity of goods demanded does not equal the quantity of goods supplied

• The price at which the quantity of goods demanded exceeds the quantity of goods supplied

• The price at which the quantity of goods demanded equals the quantity of goods supplied

• A fixed price for goods set by a government authority

Define the term "equilibrium quantity."

• The price at which the quantity of goods demanded equals the quantity of goods supplied

• The quantity of goods demanded and supplied at the equilibrium price

• The total amount of goods available in the market

• The difference between quantity demanded and quantity supplied at a particular price

Define the term "price floor."

• A government- or group-imposed price control or limit on how low a price can be charged for a product.

• The maximum price a seller is allowed to charge for a product or service.

• A strategy used by companies to determine the selling price of a product based on cost.

• The equilibrium price in a perfectly competitive market.

Define the term "price ceiling."

• A legal maximum on the price at which a good can be sold

• A legal minimum on the price at which a good can be sold

• A recommended price for selling goods in a competitive market

• The highest price a consumer is willing to pay for a good

Define the term "rationing."

• The allocation of scarce resources among people

• A method of statistical analysis

• A type of economic system

• A process in manufacturing